LTV of 104% ???!!!

buckolfc

Hi,

My mortgage deal is about to run out and I have been sent a letter from my mortgage company (Accord). Its say's that they have estimated the value of my property and will offer me a new product based on a Loan To Value of 104%

Criminal!!!

I bought the house in 2007 for £132,000. With my 5% deposit and got a mortgage (from Accord) for £127,000. They now value my property at £122,000.

This is despite them valuing the house at £132,000 7 years ago. A quick search would suggest that homes in my area have risen by 4% in this time period.

My question is HOW can the same company do this. They didn't question the initial value of the house 7 years ago but all of a sudden tell me the house has lost £10,000 in value??

Surely I was mi-sold the product 7 years ago, by over valuing my house and Accord now have a responsibility to stick to their initial valuation and the statistics that say house prices have risen.

For me to get a 95% product I would need to find £11,000!!!

At least !!!!!! Turpin wore a mask!!

Any advice would be welcome. Thank you.

[Deleted User]

A drop of 8% seems reasonable, given you bought at a price peak.

You weren't mis sold.

If you don't like their current offering, you could remortgage elsewhere.

buckolfc

Deleted_User wrote: »

If you don't like their current offering, you could remortgage elsewhere.

Thanks for that brainstorm!

PeacefulWaters

What are similar properties in the area on the market for?

What have similar properties sold for?

How much do you think it's worth?

Do you have the option of paying them for a new valuation?

What interest rate are you moving from and too?

Have you considered remortgaging where a new lender will value afresh?

buckolfc

Thanks for the reply.

Similar properties are up for £125000 - £130000

Not much selling in the past 12 months. Similar went for £136000 in 2011. (slightly bigger than mine).

I had the house valued by a local estate agents who said they would go around £128000. I know the agent personally so he was not over valuing to get my business but he did warn me that mortgage company's were under valuing properties at the minute.

They will come out and value the house but at a cost.

5% - 5.99%

We have a young family so I could do without putting down another deposit to secure a mortgage elsewhere.

pjread

buckolfc wrote:

Similar properties are up for £125000 - £130000

Not much selling in the past 12 months.

...

I had the house valued by a local estate agents who said they would go around £128000.

Hate to say it, but if nothing's moving at [URL="tel:125-130"]125-130[/URL]k asking price then a 122k valuation doesn't sound unreasonable... and it's within 5% of the valuation your friend (who probably didn't want to go too aggressive, and is in an industry where it's natural to be optimistic about price) gave you.

pjread

[QUOTE=buckolfc;[URL="tel:65225548"][/url][URL="tel:65225548"]65225548[/URL]]Similar properties are up for £125000 - £130000

Not much selling in the past 12 months.

...

I had the house valued by a local estate agents who said they would go around £128000.[/QUOTE]
Hate to say it, but if nothing's moving at [URL="tel:125-130"]125-130[/URL]k asking price then a 122k valuation doesn't sound unreasonable... and it's within 5% of the valuation your friend (who probably didn't want to go too aggressive, and is in an industry where it's natural to be optimistic about price) gave you.

What's your plan for repayment? at 104% LTV on 122k valuation, guessing you're on interest only... Personally I would be concerned I hadn't paid any of this off over 5 years, unless you have a cast iron repayment vehicle.

kingstreet

Lenders use an indexed valuation system which can be unreliable and an inspection by a surveyor may end in a different result.

However, that may be higher, or lower than the index.

I hate to say it, but this is one of my main reasons for avoiding Accord. That 5.99% SVR is just not worth the risk when all you get is about 0.2% off the initial rate offered by the likes of Nationwide with its 3.99% SVR and commitment to giving existing borrowers at least as good rates as it gives new ones.

Caz3121

buckolfc wrote: »

I bought the house in 2007 for £132,000. With my 5% deposit and got a mortgage (from Accord) for £127,000. They now value my property at £122,000.

This is despite them valuing the house at £132,000 7 years ago. A quick search would suggest that homes in my area have risen by 4% in this time period.

My question is HOW can the same company do this. They didn't question the initial value of the house 7 years ago but all of a sudden tell me the house has lost £10,000 in value??

You bought at the peak. Prices are lower than they were in 2007 (in most places) my sister just sold her house for 12% less than bought in 2006...which area are you in that shows an increase of 4% since 2007 peak?

If your original mortgage was £127k and you have been paying it for 7 years, what is the current mortgage amount?

edit: from your thread a couple of years ago you are on a 30 year interest only mortgage and knew you were in negative equity then so were looking to overpay
did you do this?
https://forums.moneysavingexpert.com/discussion/3830135

Thrugelmir

Start paying down the mortgage. Sounds as you are on interest only. Which means you are highly exposed to future increases in interest rates. .